Rees-Mogg's Somerset Capital Management to offload Russian interests

Published by Scott Challinor on April 1st 2022, 12:00am

Somerset Capital Management, the investment firm founded and part-owned by government minister, Jacob Rees-Mogg, has declared that it will offload its shares in Russian firms.

Somerset Capital Management’s December accounts indicated that it held stakes in four businesses operating in Russia, one of which it has already offloaded.

Two of the four firms include Russian search engine Yandex, and recruitment company Headhunter.

According to Somerset Capital Management, the shares it has now jettisoned were in Russian natural gas company, Novatek.

The decision to offload its investments in Russia comes amid government pressure to terminate business with the country following the Kremlin’s decision to invade Ukraine.

In a statement, Somerset Capital Management said that it would exit its other shareholding positions in Russian companies “in an orderly manner in due course” and would not be starting any new investments in the country.

A company spokesperson said: “We confirm that Somerset will not be making any new investments in Russia. As a global emerging markets equity specialist, most of our portfolios are invested in fast-growing economies including Brazil, South Korea, India and South Africa.”

To avoid a conflict of interest with his ministerial role, Rees-Mogg [pictured] has continued to hold a stake in the firm he founded in 2007 as a sleeping shareholder and still receives payments from the company but has not been involved in any of its decision-making processes since becoming a member of the cabinet.

Elsewhere, chancellor Rishi Sunak has been quizzed over his wife’s shares in the Indian software company, Infosys, after it chose not to close its office in Moscow.

Infosys said in a statement that it kept a “small team of employees based out of Russia” whose role it is to “service some of our global clients, locally” adding that the Russia-based team “supports and advocates for peace between Russia and Ukraine”.

The chancellor has denied having anything to do with the running of the company, which was founded by the father of his wife, Akshata Murty. Sunak has also been vocal in Parliament in encouraging UK firms to cut all business ties to Russia.

Image taken from Wikimedia Commons

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Scott Challinor
Business Editor
April 1st 2022, 12:00am

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